The American press has the blues. Too many authorities have assured it that its days are numbered, too many good newspapers are in ruins. It has lost too much public respect. Courts that once treated it like a sleeping tiger now taunt it with insolent subpoenas and put in jail reporters who refuse to play ball with prosecutors. It is abused relentlessly on talk radio and in Internet blogs. It is easily bullied into acquiescing in the designs of a presidential propaganda machine determined to dominate the news.
Its advertising and circulation are being drained away by the Internet, and its owners seem stricken by a failure of the entrepreneurial imagination needed to prosper in the electronic age. Surveys showing that more and more young people get their news from television and computers breed a melancholy sense that the press is yesteryear’s thing, a horse-drawn buggy on an eight-lane interstate.
Then there are the embarrassments: hoaxers like Jayson Blair and Stephen Glass turn journalism into farce. The elite Washington press corps is bamboozled into helping a circle of neoconservative connivers create the Iraq war. What became of heroes? Journalists used to dine out on the deeds of Bob Woodward and Carl Bernstein during Watergate; of David Halberstam, Neil Sheehan, and Malcolm Browne in Vietnam; of “Punch” Sulzberger and Kay Graham risking everything to publish the Pentagon Papers. Instead of heroes, today’s table talk is about journalistic frauds and a Washington press too dim to stay out of a three-card-monte game.
Rupert Murdoch of course has long spread melancholy in newsrooms around the world, but it was the disclosure in May that the Bancroft family, which controls The Wall Street Journal, might be ready to sell him their paper for five billion dollars that really struck at journalism’s soul. The sale of another newspaper is common enough these days, but The Wall Street Journal is not another newspaper. It is one of the proudest pillars of American journalism. Like The New York Times and The Washington Post, it has for generations been controlled by descendants of a founding patriarch.
Family control has sheltered all three newspapers from Wall Street’s most insistent demands, allowing them to do high-quality—and high cost—journalism. It was said, and widely believed, that the controlling families were animated by a high-minded sense that their papers were quasi-public institutions. Of course profit was essential to their survival, but it was not the primary purpose of their existence. That one of these families might finally take the money and clear out heightens fears that no newspaper is so valuable to the republic that it cannot be knocked down at market for a nice price. Murdoch at the Journal is a dark omen for journalists everywhere. When the sign in the shop window says “Everything For Sale,” it is often followed by “Going Out Of Business.”
There is a growing literature about the multitude of journalism’s problems, but most of it is concerned with the editorial side of the business, possibly because most people competent to write about journalism are not comfortable writing about finance. Still, it is on the ownership and management side that the gravest problems exist. The best discussion of trouble in boardroom and business office is found in newspapers’ own financial pages and speeches by journalists in management jobs. One document widely read among newspaper people is a speech delivered to the American Society of Newspaper Editors a year ago by John S. Carroll, formerly editor of the Los Angeles Times. It is an eloquent expression of the uneasiness many reporters and editors now feel about the future. Carroll titled his speech “What Will Become of Newspapers?” and, as the title suggests, his prognosis was not cheery.
He was especially alarmed about the breakdown of understanding between owners and working journalists and about the loss of common purpose that once united them. This has come about, he said, because the functions that were once the realm of strong publishers have been taken over by Wall Street money managers. The breakdown at the top began some forty years ago when local owners began selling their papers to corporations. As the nature of markets changed, power shifted from the corporations to investment funds, which make money by investing other people’s money in ways that make it multiply. It became hard to say anymore who or what a newspaper owner was. Owners ceased to be “identifiable human beings,” as Carroll put it. Sometimes the owner, who had once had a name—Otis Chandler of the Los Angeles Times, John Knight of Knight Ridder newspapers, Barry Bingham, of the Louisville Courier-Journal—became an it. Sometimes it seemed to be a room full of market researchers trolling the world by computer for profitable investment opportunities. Sometimes it was a fund manager with neither experience nor interest in journalism.
In this “post-corporate phase of ownership,” Carroll said,
we have seen a narrowing of the purpose of the newspaper in the eyes of its owner. Under the old local owners, a newspaper’s capacity for making money was only part of its value. Today, it is everything. Gone is the notion that a newspaper should lead, that it has an obligation to its community, that it is beholden to the public….
Someday, I suspect, when we look back on these forty years, we will wonder how we allowed the public good to be so deeply subordinated to private gain….
What do the current owners want from their newspapers?—the answer could not be simpler: Money. That’s it.
Carroll is an authority on the subject. As editor of the Los Angeles Times, the owner to which he reported was the Tribune Company, a conglomerate which had mushroomed out of Colonel Robert McCormick’s Chicago Tribune, self-styled “World’s Greatest Newspaper.” Before anyone guessed that the late-twentieth-century stock market boom was a bubble in the making, the Tribune Company had bought famous old newspapers hither and yon. Among them was the Los Angeles Times, then widely respected as one of America’s finest dailies.
Its reputation had been built a generation before Carroll’s arrival by Otis Chandler, a dynamic publisher willing to spend expansively, and sometimes extravagantly, to compete with the best in journalism. He could afford it because he belonged to the family that owned the paper. These were the descendants of Harry Chandler (1864– 1944), a California real estate tycoon, who had set up trusts for his children in the Depression years. It was a family that multiplied rapidly; at last count the Chandler trusts were thought to provide the main source of income for about 170 of Harry’s descendants.
In Otis’s time the number was smaller, of course, and though many resented his take-charge style and his indifference to the paper’s traditional right-wing politics, he was able to have his way with the Times as long as the other Chandlers’ money was not imperiled. Time passed, and Otis with it, and the Chandler heirs, who had never been wild about journalism anyhow, were courted by the Tribune Company. The deal was consummated in the year 2000 with the Tribune Company buying the Times and its parent Times-Mirror Company for $8 billion in stock and three seats on the Tribune board.
The Times-Mirror Company had itself been collecting newspapers (Newsday on Long Island, The Baltimore Sun, and The Hartford Courant, among others), and these all tumbled into Tribune’s basket in Chicago. Tribune was obviously a mammoth financial organization and hence extremely vulnerable when the market bubble broke and stocks, especially newspaper stocks, began declining. Carroll had the Times cruising successfully and was amenable to economizing when his Chicago bosses began asking him to cut editorial costs in 2003. Then he was asked to cut again. And again. He began objecting that the cutting was seriously damaging the paper, but Chicago insisted on more cuts. Eventually, in 2005, he resigned. The editor succeeding him was soon told that still more cuts would have to be made, and he resigned too.
Journalism was being whittled away by a Wall Street theory that profits can be maximized by minimizing the product. Papers everywhere felt relentless demands for improved stock performance. The resulting policy of slash-and-burn cost-cutting has left the landscape littered with frail, failing, or gravely wounded newspapers which are increasingly useless to any reader who cares about what is happening in the world, the country, and the local community. Cost-cutting has reduced the number of correspondents stationed abroad, shriveled or closed news bureaus in Washington, and crippled local reporting staffs which once kept an eye on governors, mayors, state legislatures, small-town rascals, crooks, and jury suborners. It has also shrunk the size of the typical newspaper page, cutting the cost of newsprint by cutting news content.
Newspapers report their own erosion in the business columns, doggedly recording inch-by-inch shrinkage of page sizes and job-by-job shrinkage of news coverage, but statistics alone cannot convey the true loss to the country. Besides the Los Angeles Times, the papers showing the ravages of extensive cost-cutting include many once ranked among the country’s finest: The Baltimore Sun, The Miami Herald, The Philadelphia Inquirer, The Des Moines Register, The Hartford Courant, the Louisville Courier-Journal, the San Jose Mercury News, and the St. Louis Post-Dispatch, for example.
The new-style owners are often puzzled when their editors and reporters make the traditional argument that journalism’s business is to provide a public service by supplying the information the citizenry needs for democracy to work. The new owners have a different view of duty. They are “sometimes genuinely perplexed to find people in their midst who do not feel beholden, first and foremost, to the shareholder,” Carroll says.
What makes these people tick? they wonder. The job of any employee, as they see it, is to produce a good financial result, not to indulge in some dreamy form of do-gooding at company expense…. Our corporate superiors regard our beliefs as quaint, wasteful and increasingly tiresome.
Carroll’s speech is invaluable for its working journalist’s grim view of how competitive market practices have changed the business; but Donald Graham recently provided a similar view from the owner’s seat. Graham is chairman of the board of The Washington Post, and his comment appeared on the Op-Ed page of The Wall Street Journal in April when Wall Street had The New York Times under attack.
Carroll is saying that free-market capitalism doesn’t really work very well in the newspaper business, and, if rigorously applied, tends to destroy it. Astonishingly—he is an owner, after all—Graham seems to agree. His essay, only a thousand words or so in length, was notably angry in warning that Wall Street’s single-minded insistence on maximizing profits could be fatal to journalism.
His statement was provoked by a Morgan Stanley money manager’s efforts to break the two-tier stock structure that preserves the Sulzberger family’s control of The New York Times. This arrangement was built into the Times corporate structure when the company entered the stock market in 1967. It limits control of the company to people holding a preferred class of stock, most of whom descend from Adolph S. Ochs, who founded the modern Times in 1896. Its present publisher, Arthur O. Sulzberger Jr., is Ochs’s great-grandson.